UK housing market shows cracks as prices hit record-high vs salaries
British house prices reached unaffordable levels compared to average incomes making it hard for most people to buy homes. Current mortgage rates and economic factors point to market cooling-down
The UK housing markets long-term growth story seems to hit a wall. Since early-2000s prices jumped from £85k to £291k (a huge 342% rise)‚ but now the real-estate party looks done
In southern England more than half of full-time workers cant buy even basic 2-3 bedroom homes. Richard Donnell from Zoopla points out: “buyers need 50% above-average income to get property here“
The mortgage situation looks tough – rates jumped from 2.34% (back in 2021) to 5.5% today. A £500k loan that used to cost £2‚204 monthly now needs £3‚070 (which makes family-sized homes hard-to-get without help from parents)
Housing has been in a bubble to a massive extent in some parts of the country
Property listings show clear signs of market cool-down:
- 24% of sales had price cuts in 2022
- 36% needed price drops in 2023
- 38% faced reductions in 2024
The markets future doesnt look bright: wage growth will hit zero by 2026-27 (as per govt forecasts); stamp duty costs might double by 2030‚ and owner-occupier costs keep rising at 7.4%. Charlie Lamdin from BestAgent says: “perfect time to sell was 2 years ago – now larger homes owners are confused why they cant sell even with 20% price cuts“
